OnePath Custodians (OPC) has been fined $1.46 million by the Australian Prudential Regulation Authority (APRA) for failing to direct member contributions to a MySuper product.
Trustees must direct member contributions to a MySuper product when the member has not advised the trustee where they would like their money invested under the Superannuation Industry (Supervision) Act 1993.
OPC is one of four superannuation trustees owned by Insignia Financial Ltd (formerly IOOF Holdings Limited) and has approximately 700,000 members and $35 billion in funds under management.
APRA issued infringement notices for fines imposing a cumulative penalty of $1,464,350 after becoming aware that OPC failed to direct 125 default member contributions to a MySuper product from mid-2022 onwards.
The trustee could not use members’ money to pay the fine and had 28 days to do so with the penalty sum applied to the Commonwealth Consolidated Revenue fund.
APRA deputy chair, Margaret Cole, said trustees that breached their obligations under the SIS Act should expect to face severe consequences.
“It is imperative that trustees adhere to the law and direct members’ money to the correct product in a timely manner to ensure their best financial interests are protected at all times. APRA takes these provisions seriously and will act swiftly in deploying its enforcement toolkit where trustees fall short of our expectations.
“We expect trustees to have robust governance, compliance and risk management frameworks embedded and operationalised to prevent, detect and swiftly remediate potential breaches of their obligations.
“In addition to today’s enforcement action, APRA is closely monitoring OPC to ensure any members who suffered financial losses as a result of these breaches are fully compensated as soon as possible.”
Lindsay Smartt, chairman of OnePath Custodians Pty Limited, said: “OnePath Custodians Pty Limited (OPC) acknowledges the infringement notices and fine issued today by the Australian Prudential Regulation Authority (APRA). The infringements relate to 125 default member contributions being incorrectly attributed to the member’s Choice rather than MySuper account.
“OPC is committed to continuing to uplift its governance, compliance and risk management frameworks and is working closely with the regulator to meet its expectations.”
What’s the common denominator between this and the IOOF blow up with APRA and the Royal Commission? They can try all the marketing hype they like about being client centred and spend shareholders money to change the corporate name to Insignia to try and wipe the stain away. Doesn’t change the culture. Who in senior management at the time of the Royal Commission didn’t get wiped out?
Very poor.